The Best Money Blog

How To Cultivate An Attitude For Success

You’re going to see a lot of posts on The Best Money Blog about the fundamental attitude of people. This is simply because it is not the lack of ideas or abilities that hinders us from success, but the way we approach our lives.

I use the word cultivate to show you how you should view your financial situation. Most people do not get rich quick and most others do not even get rich slowly. It is said that 10% of people control 90% of the wealth in the world.

You can become part of that 10% with the right attitude, but you must invest your time, money, and effort and with continual attention, you will begin to reap the benefits of your labor.

A Conversation Starter

I am going to re-enact a dialogue I once had that illustrates how some people view money in their lives. Although you may think it is over-the-top and ridiculous, it is still only an exaggeration of how most people act, whether consciously or subconsciously, in their everyday lives.

Me: So you’re out of work, huh?

Doofus: Yeah. It’s not so bad. It just sucks because I’m having trouble paying all my bills, but at least I’m collecting unemployment.

Me: That’s understandable. Did you have any money saved up for emergencies like this?

Doofus: Not really. I didn’t expect for something like this to happen. On top of everything else, I broke my arm last week messing around at the lake and have no health insurance to cover the emergency room visit and cast on my arm.

Me: That sucks. You could always try to find some side work and sell some things you don’t need or try to get some kind of help in paying the hospital bills.

Doofus: Yeah right! I worked hard for everything I own. There’s no way I’m getting rid of it. I’m sure it’ll work itself out eventually. I already got the medical bills cut in half so that’s a good start.

Me: What about some side jobs?

Doofus: I don’t have any time. I just started building a new truck and I want to have it done in the next couple of months. Usually it would take almost a year, but being out of work gives me a ton of time to work on it.

Me: New truck? You and your wife already have two vehicles. I thought you were struggling to pay the bills?

Doofus: Yeah the mortgage payments are the worst, but I still need to finish this thing before summer hits.

Me: How much has the truck cost you so far?

Doofus: I ordered $8,000 worth of parts last week. They should be here any day now, I had them shipped 2^nd day air.

Me: So you’re telling me that you’re close to defaulting on your home loan and have thousands of dollars in medical bills, but you’re spending your entire unemployment check and 10 hours a day working on a truck solely for your own pleasure.

Doofus: So what? I worked at that company for 20 years and they just laid me off like I was nothing. I deserve to milk this unemployment for as long as I can.

Me: I gotta go before I sock you in the throat.

This is not a fictional story created to prove a point, but a real conversation I had with somebody in the midst of an economic crisis. I may have changed some names and added my closing remarks but you get the gist of it.

There is so much wrong going on here I can’t believe it’s not butter. Poor planning, a sense of entitlement, irresponsible spending, and a lack of corrective action are just a few of the more obvious problems. If that doesn’t disgust you enough, then what if I were to tell you that you do the exact same thing?

Eliminate Poor Planning

No one expects the unexpected, hence the definition. What’s worse is that no one plans for the unexpected.

What if your spouse was in a car accident or your bathroom flooded because of a burst pipe? I am not just playing devil’s advocate. Both of these things have happened to me.

Obviously the first step in planning for the unexpected in this situation would be to have insurance for these types of things, but what about the things insurance might not cover?

Time off of work, damage to personal possessions, having to live with Aunt Mimi and her eight poodles until your bathroom is in working order again.

Do you have any kind of emergency fund? I’m not talking about few $20’s sitting between the pages of Pride and Prejudice on your shelf. I’m talking about a large enough sum of money to cover your entire living expenses for months at a time.

Most financially responsible folks would recommend having 3-6 months worth of living expenses saved up in an emergency fund. This isn’t just a savings account you casually dip into whenever you want a new pair of shoes. This is an account that remains untouched unless you have a bona fide emergency on your hands.

So again I ask, do you have an emergency fund? If the honest answer is a “no”, then start one now. Even ten dollars a week can add up pretty quickly. One of my most successful strategies in saving is to have a certain amount of money automatically transferred to my savings account each week. Then, on top of that, save 50% of any unexpected income that I might make.

Erase Your Sense Of Entitlement

Everyone has this attitude to an extent. It just comes naturally.

Stop looking at things from the perspective of getting what you deserve, and start seeing it as receiving what you have earned.

Your paycheck is not given to you because you are a wonderful person and great worker. It is simply an exchange of your time for their money. If you didn’t exist, somebody else would be right there to take your place, no matter how prestigious you think your position is.

I’ve met plenty of people who work for an employer and complain that they deserve to be paid more than the other five people doing the exact same thing. The only way that is going to happen is if you get a job that pays more, or figure out how to earn alternative income. You’ll hear more about alternative, passive, and residual income in future posts.

If you desire more from life, you had better be prepared to take action. In most cases, it is not going to be handed to you on a silver platter.

Respond To Irresponsible Spending

I’m not going to get into the mess that has caused our economy to self-destruct, but I will say that it all comes back to irresponsible spending. Many people blamed big banks and corporations, and I’m not saying that they aren’t to blame, but if they examined their own habits they would realize that they are just the same in many ways.

Like our friend Doofus in the story above, many people live beyond their means, spending more than they earn. They bring home $3,000 a month and spend $4,000, all the while racking up huge credit card debt, defaulting on loans, and losing their businesses.

If you only take one thing away from this article, I hope it is this. Do not spend more than you earn.

In fact, the most financially stable people would say that you shouldn’t even spend half of what you earn. The balance in your bank account should have a steady growth curve over time.

Living paycheck to paycheck is a dangerous game and is not just for the lower and middle class either. Many wealthy people earning over $10,000 a month have amassed enormous amounts of debt as well. It just goes to show that there is more to being successful than just earning more money. You also have to know how to save, spend, and invest.

Correct Your Actions

This is where most people get stuck. They have spent all their money and then some and know they are in trouble, but don’t know what to do.

Let me say one thing first, it is never too late to become financially responsible.

If you are in debt, struggling to pay your bills, or just living paycheck to paycheck, you must understand that you can still change for the better.

Some easy steps you can take on the road to correcting your spending habits include:

1. Stop buying non-necessities
2. Purchase things on sale
3. Do not buy things unless you have the cash to pay for them in full

Once you have curbed your spending, you should start paying off any and all debts that you can, as fast as you can. Personally, I have eaten nothing but tuna and ramen noodles for months at a time to reach my financial goals. Most people are only comfortable cutting back in smaller increments. The more you cut out the more you will save, but the point is not necessarily to go all out. The point is to simply get started and continually make progress.

Successful Economic Growth

Each of these core issues affects the way you view, save, and spend money and it sometimes takes a truly radical change in attitude to reach your financial goals.

Think about these simple things to broaden your mind to how money affects your life:

1. Plan for the worst and hope for the best. Hopefully you will never have to use your emergency fund, but you should still have one. It will get you in the habit of saving and give you comfort in knowing that if something does happen, you will be prepared.
2. Expect to receive only what you deserve. The only way you will get ahead in life and reach your goals is through hard work and discipline. Following your plan passionately will yield the results you’ve always dreamed of.
3. Spend less than you earn and evaluate what you buy. People spend money on a lot of dumb, fleeting things. If you can learn to say no to yourself, you will be ahead tenfold for the future.
4. Start your new financial life now. Remember, it’s never too late to change your habits when it comes to money. No matter what other people say, you can always find financial success if you make a plan and stick to it.

Do you see any of these traits in your life? What are some other tips and tricks that you have used to succeed? Leave your comments below.